Flint Group Packaging announces the intention to further increase the prices of all its ink and coating products for the Flexible Packaging, Paper & Board and Narrow Web markets. Increases will vary by product and will be applied throughout the remainder of 2021.
The increasingly challenging array of conditions present across the ink & coating supply chains are showing no sign of abating. Conditions have worsened over the summer period as the availability of key raw materials, packaging & freight has tightened, driving costs to unprecedented levels. Flint Group Packaging is now facing confirmed cost increases at extraordinary levels and many key raw materials are on allocation following numerous force majeure events.
Costs are increasing rapidly and supply is tightening across all procurement categories however, the vast majority of the cost escalation can be seen in the raw material markets. Esters, Resins (both UV and conventional), Pigments, Titanium Dioxide (Ti02) & Organic Chemicals represent the majority of the increases. Raw material increases are being further compounded by a series of packaging and freight cost increases. The magnitude and speed of all increases is unparalleled.
Doug Aldred, Chief Commercial Officer – Flint Group Packaging said, “It is clear that inflationary pressures are having a considerable effect on our supply chains. Unrelenting competition for resources and energy in markets still reeling from the effects of the global pandemic is a catalyst for compounding price increases of a scale not previously witnessed. We continue to face relentless cost and availability headwinds, across multiple procurement categories.”
Emmanuel Bareaud, President – Flint Group Narrow Web notes, “Acute shortages of essential feedstocks are jeopardising the supply of all our key raw materials – the situation is particularly pronounced for photo-initiators. Couple this with the pressure the global freight industry is under and it is evident that costs will continue to rise. As a matter of fact, some raw materials are reaching cost peaks not witnessed in twenty years or more.”
Furthermore, Mr. Aldred continues, “The security of supply is our number one priority. Despite the unprecedented conditions, we are completely committed to our customers and will collaborate with all our global supply chain partners, in order to mitigate as many negative effects as possible.”
Despite expectations that the current conditions will continue to deteriorate well into 2022, the business continues to invest in its assets, capabilities and operating efficiencies to mitigate adverse effects, wherever feasible. Nonetheless, it has become clear that these activities alone will not suffice; where contracts allow, the company will seek to recover costs via a combination of extensive productivity optimisations, price increases, indexation and temporary surcharges.